In terms of market cap, the two coins are coming closer and closer to parity. It is unclear what the so-called flippening will mean in terms of Ethereum’s price movement. The cryptocurrency will benefit from both the resolution of Bitcoin’s scaling controversy (the two assets are highly correlated) and the launch of several new Initial Coin Offerings in the coming week.
Bitcoin’s Scaling Controversy Mining pools AntPool, Bitcoin.com, Bitfury, Bixin, BTC.com, BTC.top, BW Pool, F2Pool, and ViaBTC (which represent about 71% of the network’s mining power) are already adding a piece of text to each block that they mine to show their support. Once the code is ready for showtime on 21st July, mining pools will be able to run the software.
The Segwit2x scaling agreement will require 80% of the mining hash rate to run the code for roughly three days starting on that date, and the resolution of Bitcoin’s scaling issue is mixed news for Ethereum, albeit primarily positive. On top of this, Bitcoin’s poor scaling slowed down the system, making Ethereum more appealing for commercial transactions.
With the Bitcoin scaling issue on its way to amicable resolution, Ethereum investors can benefit from some of the other fundamental catalysts for upside in the asset. These applications use the Ethereum network to build a variety of different services that usually come with their own digital asset called a “token”.
These start-ups are funded through what is called an Initial Coin Offering (ICO). Investors will only be able to buy these new tokens with Ethereum, and this could drive up the price of Ethereum during the fundraising period. And as a result, Ethereum is set to continue its strong performance for the remainder of June. The cryptocurrency has strong catalysts for upside including the upcoming resolution of Bitcoin’s scaling issues as well as several large initial coin offerings that will be based on the Ethereum platform.
As the value of Ethereum continues to rise, many observers predict it will replace Bitcoin as the largest cryptocurrency by market cap.
Disclosure: I have a long position in Ethereum. I have no business relationship with any company whose stock is mentioned in this article.